Senator Erwin Tulfo, chair of the Senate Committee on Energy, urged regulatory officials on Thursday to eliminate value-added tax (VAT) and non-technical system loss charges from electricity bills, insisting that law-abiding consumers should not pay for power theft.
During a committee hearing, Tulfo criticized energy regulators for allowing distribution utilities to pass the costs of pilferage—such as illegal “jumper” connections, meter tampering, and unauthorized hookups—onto the paying public.
“I would like to get your opinion, bakit hinayaan ninyo na singilin nang singilin ang taumbayan ng systems loss, doon na lang sa non-technical — yung pilferage, jumper, illegal connection,” Tulfo said.
“Bakit hinayaan ninyo ang mga distribution company na singilin kaming taumbayan na hindi naman namin kasalanan?” he asked.
In response, Energy Regulatory Commission (ERC) Chairperson Francis Juan explained that system loss caps originate from Republic Act 7832, or the Anti-Electricity and Electric Transmission Lines/Materials Pilferage Act passed in the 1990s. The law permits power distributors to recover specific system losses up to a statutory limit.
“Ang pagkakaroon natin ng systems loss cap ay nagsimula at nababatay sa anti-pilferage act noong 1990s pa,” Juan said. “This is a legitimate cost but subject to a limit.”
Juan noted that the ERC is currently reviewing whether to lower the non-technical loss cap to zero, which would bar distribution utilities from shifting those expenses to consumers.
However, Tulfo pressed for immediate legislative steps, emphasizing that removing non-technical system loss charges and VAT remains a top priority for the energy panel.
“Ito yung hinahanap natin ng committee na ito — siguro unahin na natin itong non-technical, mga pilferage, illegal metering, tampering, huwag na isingil sa mga kababayan natin pati yung VAT,” Tulfo stated.
The legislative push aligns with President Ferdinand Marcos Jr.’s directive during his fifth State of the Nation Address to amend existing energy statutes and ease power rates for Filipino households.